1% tourism tax stays put for now

The 1 percent sale tax in Haines allotted to tourism and economic development will stay put, and stay off the October ballot, for now. On Tuesday, the assembly discussed whether to leave the tax’s future in the hands of Haines voters, and decided against advancing that proposal. The idea was brought forward by a local fisherman several weeks ago.

Haines fisherman JR Churchill told the finance committee last week that he thinks the tax needs to resurface on the ballot. He said he’s tired of public money going to private business.

But on Tuesday, several members of the public, and most of the assembly disagreed.

“The sales tax revenue benefits the entire community.”

“We not only collect that 1 percent from all of our guests, but we collect the rest of the 4.5 percent that we see from those guests when they’re enticed to come to our town.”

“It has a ripple effect that hits virtually every sector of the economy, and that needs to be taken into consideration when you look at this.”

That was Karen Hess, Robert Chadwell, and Kyle Gray.

The 1 percent tax was voted into effect 30 years ago to help the borough pay off a legal settlement. That proposition passed 230-207 with the addition that once the lawsuit was paid off, the tax would then go to tourism. A repeal of the tax means more than $500,000 would disappear from the borough budget.

Leslie Ross is the borough’s tourism director. She said on Tuesday, repealing the tax has huge implications that many aren’t aware of.

“What would happen to the tourism department?” she said. “Would it go away? Would something else be cut to replace that funding? I just think it would be very rash to put it on this ballot without proper time to educate people.”

For the most part, the assembly agreed that putting it on the October ballot would be a hasty decision. Here’s Assemblywoman Diana Lapham.

“If it truly has the support, then let the citizen initiative come forward and we put it on the ballot next year,” Lapham said.

A citizen initiative would require a resident to petition for the change and then collect signatures totaling 25 percent of the most recent voter turnout. Assemblymember Mike Case said if they’re going to put the tax repeal proposal on the ballot, why not put a measure on the ballot to paint all the borough buildings pink and white?

“We don’t do it because there’s no call for it, and there’s no call for this except from just one or two people,” Case said. “I don’t even know why we’re discussing it this much. I value their opinion, but I’m not going to go and vote for it.”

According to Mayor Jan Hill, only one other person, besides Churchill, contacted the borough to offer support for repealing the tax.

Assemblyman George Campbell, who was on the phone from Sitka, was the only assembly member who thought the idea should be on the ballot this year.

“I wouldn’t be afraid to put it on the ballot because we banter around whether or not it’s got support… Who cares?” Campbell said. “When it goes on the ballot, the question gets answered pretty darn quick because the voters are going to tell us exactly what they want to do.”

There was no motion on the table about this issue, and the assembly will not take action to send the question to voters.

Also at this week’s meeting, after a lengthy back and forth, the assembly voted to adopt the collective bargaining agreement between the borough and Public Employee’s Local 71. The three-year contract, which includes a 1 percent raise, will cost the borough around $97,000 the first year and $20,000 for the second and third. A couple of assemblymembers and one member of the public thought more time should be taken to go through the contract, even after multiple hours had been spent already by the negotiating team. The borough’s Chief Financial Officer, Jila Stuart spoke in support of the contract. She explained that denying scheduled, and deserved raises, could mean employees will go elsewhere to find work.

“The negotiating committee tried to balance the dismal projections for shrinking budgets against the need to retain good staff,” Stuart said. “And, as I’m sure you’ve heard before, turnover is very expensive and that’s a reality.”

Stuart added that, according to Alaska Municipal League data, Haines Borough employees make just 65 to 85 percent of what their counterparts do in other communities.